A multi-country analysis of aggregate inventory behavior

The paper provides an analysis of macroeconomic inventory trends. Using eight different models we have studied the connection between inventory intensity (ratio of inventory investment to GDP) and the various components of GDP, both as simultaneous and lagged variables. Data of 88 countries have been used for the analysis. The analysis supports previous studies according to which even though no strong connection can be disclosed, a few interesting consequences can be drawn, concerning the differences of inventory intensity in different groups of countries, the relation of effects of lagged and simultaneous variables and the significance of various components of GDP. (C) 1999 Published by Elseiver Science B.V. All rights reserved.